Micromobility in Uncertain Times

At Blue Clover Devices, we have long been invested in the future of mobility. Afterall, some of our biggest clients include household names in transportation like Tesla and Audi. More recently, we’ve added micromobility firms, Scoot, Spin, and Uber to our list of clientele. As transportation becomes smarter, we’re more and more excited to be experts on all things IoT.

Originally, I was hoping to share our company’s reactions to a car free Market street (given that our US office is based in San Francisco).

But before I could publish our team’s thoughts on car-free market street, something happened. San Francisco went under a citywide lockdown to prevent the spread of COVID-19. As a citizen of Silicon Valley, I am no stranger to the effects of disruption, but obviously this is not the type of disruption any of us would strive for!

Originally, the team at Blue Clover Devices was planning to participate in the Micromobility America 2020 conference during the month of April. Unsurprisingly, the event has been rescheduled for obvious health reasons. (Instead of seeing our team at the Micromobility conference, you get this blog post until then!) Of course, the postponement of a major event is not the only impact that COVID-19 is having on micromobility companies.

In the Bay Area, where shared micromobility service startups are the main talking point, COVID-19 exacerbates some of the pre-existing logistical requirements, like maintaining the individual scooters or bikes. That combined with the decreased ridership, is causing a new set of problems.

Unsurprisingly, the cool folks at Micromobility America had some thoughts about this as well. At the end of March, I had the pleasure of sitting in on an open Zoom call with Horace Dediu (Micromobility Industries co-founder) and 200+ other micromobility enthusiasts. It was a long and interesting conversation about how COVID-19 might affect infrastructure across the world, transportation infrastructure being one of them. You can read Horace’s blog post that started the conversation of the call here.

Horace made many insightful observations during the call, but two points (among many others) really stuck with me: first, it would not be surprising to have this situation force a few micromobility startups (shared or not) to fold, and second, these challenging times would also force shared micromobility startups to practice flexibility, especially when it comes to pricing and business models.

The first point is not surprising. Startups are focused on rapid-growth, which allows them to be powerful forces of change and pioneers that challenge the old ways of conducting business. However, it also means that they are especially fragile. Something like COVID-19, which has already shaken up the world economy and has led to rapid changes (as world stock markets plunged and surged in what felt like just a few days time), is obviously going to unmask a lot of fragilities that otherwise might have been covered up by the previous few years’ bull economy. It means that to survive, all startups (not just the ones focused on micromobility) need to be conscious of their place in the market and find ways to stay relevant.

This leads perfectly to the second point. One of the ways micromobility startups can stay flexible and adapt is to rethink their pricing models.

One of my ever knowing coworkers, Agnes, pointed out that immediately after the call Voi Technologies, a shared scooter company based in Sweden, started offering credits to essential workers.

Meanwhile, micromobility startups like STEP are in the spotlight for their pre-existing ride models. In STEP’s case, their subscription model gives users a private vehicle for use. This means that they are not technically a shared micromobility firm, but they are different from scooter/bike companies that purely commodotize the vehicles. I am by no means suggesting that shared micromobility startups take on STEP’s model, but I am curious to see if companies adhering to a strictly shared model may start offering private subscription services in the coming months. (If you’re interested in learning more about how micromobility has been changing in Europe, this piece offers an uplifting perspective on all the great ways startups are responding to COVID-19 in spite of the difficulties).

That said, shared micromobility usage seems to have rebounded in China, as lockdowns in major Chinese cities have been lifted.

My teammates based in Shenzhen have remarked lately that after coming back to the office, they’ve noticed a lot more bikes around the city. Certainly, they’re not the only ones noticing these trends. The yellow Ofo bikes may be gone, but new on the scene in Shenzhen are many new blue HelloBikes. According to China Daily, bike usages have “soared” after the lockdown in Chinese cities has lifted. Even though lockdown in Chinese cities has been lifted, the populace is still practicing extra care. If you haven’t noticed, in all our recent pictures, our Shenzhen beavers have been consistently wearing masks. In addition to masks, there’s also a lot more awareness of social distancing. In cities where crowded public transportation is the norm, the populace may be more inclined to use scooters or bikes, since individual vehicles give commuters more space than what buses and trains can offer during rush hour.

And even in America, things are getting interesting as more time passes during the COVID-19 pandemic. I learned from a recent article by CityLab, that our neighbors across the bay in Oakland have started an #OaklandSlowStreets policy. Essentially, the city is restricting access to cars on various streets. This has made it safer for Oakland residents to walk or use bikes and scooters. Based on the city residents’ reception, CityLab speculates that some of the streets may stay slow.

This brings us full circle doesn’t it? As cities like Oakland are experimenting by closing streets to allow residents more space to socially distance (without having to be cooped up inside), the results from SF’s Market street closure have become immeasurable in the meantime. In San Francisco, the Market street closure was highly anticipated. It brought about a lot of hope for those of us who are fans of micromobility (or just walking), while drawing a lot of ire from those who have to drive in the city. But since COVID-19 came into the picture, none of those things are quite as relevant. As a San Francisco resident, I can tell you right now that the streets have been pretty empty since the city locked down in March. While there are still cars on the streets, traffic is no longer an issue, as there are less commutes to be made. Meanwhile, even though bikes and scooters are still being used, as there are less places to go to, there are also less riders.

While startups are usually focused on the question: “How do we disrupt the old way of doing things and make it better?” the question is now: “How can we survive and help others?” Micromobility startups have certainly stepped up to the plate in whatever way they can, and some have even managed to grow during these turbulent times.

For now, all we can do is wait and see what happens while making sure to follow guidelines to keep ourselves and others safe! Remember to wash your hands and wear a helmet. (Maybe wash your helmet too?)

P.S. If you are interested in doing your own research on what's happening with micromobility, I highly recommend the Micromobility Newsletter offered by Micromobility Industries.

On the same day we published this post, Uber announced its investment in Lime, in addition to handing over JUMP as part of the deal. It's interesting to see how these big names are starting to coalesce into one. Unfortunately, these mergers don't come without costs. You can read more about this news at these links:

https://techcrunch.com/2020/05/07/uber-leads-170-million-lime-investment-offloads-jump-to-lime/